When you buy an existing business, as well as taking on the running of the operation, you may also find yourself with a whole new set of employees. If you wish to keep on the existing staff – and you are usually under no obligation to do so – the changeover process must be handled delicately. A business takeover is a stressful time for employees, and on top of that, there are often legal implications involved. Care, transparency, and open channels of communication are crucial. Whether you’ve invested in a traditional brick-and-mortar business or plan to buy an online store, here’s some advice to ensure a smooth transition.
Inform Them of New Employment Terms
When you buy a business, the process of reorganizing staff can be a difficult one to navigate. New business owners should be sensitive to their rightful concerns, as well as to any legal obligations.
Start by letting the existing staff know about any new particulars they should be aware of, such as changes to their written contracts or terms of employment, as you will need their agreement to push these changes through. Do this as soon as possible. Without their agreement, you could be sued for breach of contract. Particulars might include things like changes to pension schemes and holiday entitlement.
If you are working with an online business, you may need to spend some time consolidating offshore teams and employment contracts into one place, as online staffing can be erratic, and people may be spread across different platforms like Upwork or PeoplePerHour.
Respect the Systems and Relationships Already in Place
Regardless of whether you are keeping the existing workforce or bringing in new people, it’s important to take stock of the products and customer/supplier relationships that the team has built so far. They may have worked at the company for several years, and to see all their hard work wiped away to make room for a clean slate will be understandably aggravating.
Take care not to be openly dismissive of everything the company has achieved so far, even if you think you can do better. If you want to keep the team – and what’s more, keep them on your side – it’s important to have respect for what went before, and to at least solicit their opinions about the changes you plan to make. Remember, they’ve been involved in this business longer than you have.
If you are buying an online business, make sure that you have access to all the files and documents concerning remote workers, virtual teams, dropshipping suppliers, and freelancers. Running an online business is so much more than just buying up a website — without the correct people and access to the right connections, you might end up with just a pile of pointless pixels.
Always keep in mind when buying a business which relationships you will need to conserve to guarantee profitability.
Plan for Tomorrow – And for the Future
When you take on the running of a business, you have to think about the short-term and the long-term. In the short-term, your current employees may be struggling to adjust to the changes being thrown at them, so it’s worth putting some sort of retention program in place. You need to win them over to your way of thinking and convince them that there is no reason to doubt your leadership. The retention program should be material, such as increasing the size of their bonuses that year, as you ease through the tricky transition period.
But of course, every good business owner also plans for the long-term. An incentive program will help to keep employees on board (provided the incentives are good) and what’s more, it will help you stand out to new talent when the time comes to hire more employees. Consider an strong incentive program an investment in keeping your top people on board, rather than seeing them flee to rival companies.
You may need to consider signing non-compete or non-disclosure agreements with core members of staff or freelancers who could jeopardize your business’s future.
Consider Bringing in an Interim Manager
This may not be for everyone, but it can work for some. An interim manager is essentially a temporary member of staff who, while more expensive than everyone else, will only stick around to ease the initial transition as an impartial, objective voice. Once their assignment is complete, they move on to their next position at a new company.
Interim managers are usually experts who help to bring fresh insight to a business during its transition phase, free from the drudgery of office politics. Their primary role is to take the lead on changes being made within the company, and to take control of staff. With no vested interests aside from helping the business to succeed, an interim manager can be a valuable asset to new business owners who need support during the first weeks or months of taking over.
When managing a web business handover, a talented project manager can help reduce friction and keep all assets in order.
Know When to Let Go
Many business owners and entrepreneurs will tell you to ‘hire slow, fire fast’. This is something that comes from experience. Firing someone is never a pleasant or easy task, and of course, you don’t want to leave someone in a position where they can’t support themselves or their families. But the truth is that there may well be people within the business whose roles are no longer needed or relevant, depending on the direction you choose to pursue.
You may be tempted to try and hold on to people and shift them into a slightly different role to spare their feelings. While this can sometimes work, often it just means putting off the inevitable. As a small business owner, you have to be brave enough to make tough decisions when called for.
In the digital world, people tend to move fast, and freelance contracts can dry up or end at the drop of the hat. That’s not excuse to just rudely get rid of people, but it does give you the flexibility to bring in new staff and suppliers faster. Just make sure that existing projects and bills are paid off to avoid any ill feeling.
There’s a lot to account for when you take on a pre-existing workforce, and the truth is that most people don’t like change – even if it will potentially benefit them in the long run. So be prepared to tread very carefully, make prudent decisions as their new manager, and treat everyone well. If you plan to make big changes, consider making them over time, rather than all at once. Keep the lines of communication open, so people feel they can come to you with their concerns. Finally, before doing anything, consider seeking advice from an experienced employment lawyer to make sure you’re compliant and avoid any legal mishaps.